Florida Mortgage Rates – Morning Report

by Florida's #1 Mortgage Planner on June 4, 2010

Locking Stance:  LOCKING    Mortgage Bonds: +47bp

Mortgage backed securities got a major boost this morning with the Jobs Jamboree release, sending them through not just their 10-day moving average, but also to new recent highs.  Will it hold, though?

Well,, by now you likely have heard that the Nonfarm Payrolls was not a good report, that stocks are diving and money is flowing into mortgage bonds and other “safe havens”.  First off, Nonfarm Payrolls came in at 430,000, below estimates of 540,000, but that is not the whole story.  Obama wasn’t hesitating to say the jobs market is improving and taking credit for it, also adding we need to keep doing what we have been doing to improve the jobs market.  But reality is quite different, isn’t it?  Despite the Unemployment Rate dropping to 9.7%, payrolls were worse than expected, so why should we be celebrating?  On top of that, the private sector was anemic at best.  That fact is that the numbers were that high because the Census was hiring 411,000 TEMPORARY jobs, creating a false illusion that the jobs market is improving.  So, Mr. Obama, you are hardly doing anything to help the jobs market, sorry.  Of course, taking credit for “illusions” is his thing, even if just to inflate his ego.

The other parts of the Employment Situation report, aka the Jobs Jamboree, included Average Hourly Earnings and Average Workweek.  The Average Hourly Earnings rose 0.3%, above estimates of 0.1%.  The Average Workweek also was higher than expected, coming in at 34.2 hours versus 34.1 hours.  Overall, the Employment Situation is desperate at best in this report and MBS prices have rallied as a result.  The question remains whether they can hold or not, let alone push even higher.

What does this mean for Florida Mortgage Rates?  Mortgage rates dipped slightly lower this morning due to the extremely disappointing jobs data.  While there may be room for improvement still, it remains uncertain if mortgage rates can remain at these levels.  Once again, the risks far exceed the potential rewards.

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